Press Release Summary: For the last few years London has been one of the areas pushing UK property inflation the most. Whatever the average price rise, London\'s has been higher
Press Release Body: For the last few years London has been one of the areas pushing UK property inflation the most. Whatever the average price rise, London\'s has been higher, with prime central London areas seeing the biggest booms.
Recent figures, however, have suggested this capital trend has reversed. The latest set of Land Registry figures, among the few to show an overall increase (albeit 0.1 per cent) in house prices, stated that the capital had experienced a 0.6 fall in prices, the most of any region.
In addition to this, Firstrung reported today that property website Primelocation.com\'s prime central London prices were down by 0.8 per cent in November, making the average property in the area £22,000 cheaper than in August after three successive monthly declines.
Ian Springett, the website\'s chief executive, explained that the situation had been caused by a combination of lower demand as the city wobbles following the credit crunch and an increase in availability. This meant there had been a shift \"from constrained supply and intense demand fuelling vigorous price rises, to buoyant property volumes and dwindling demand causing a decline in prices\".
Mr Springett predicted part of this market would be negatively affected due to the fall in City bonuses, in contrast to the plentiful times of a year ago, but the very top end of the market would not suffer because those with the greatest wealth would be able to absorb any such lowering of income.
However, this market will start growing again next year, Savills has predicted. Director of research Lucian Cook suggested a five per cent increase in prices next year, stating: \"The prime central London markets are going to be impacted by reduced bonus expectations in the short-term, but that they will return to growth certainly by the back end of next year.\"
Mr Cook went on to suggest that the market would be bolstered by overseas wealth, while in the rest of the capital there would be increasing differentials in price between areas caused by a \"flight to quality\" - a process he said was already happening in other parts of the UK, such as the midlands, the north and Wales.
Property investors may thus look carefully at prime areas in London - both central and in the suburbs - and look to buy in the expectation that the market may rise again.
One clue as to where the most valuable properties will be has been provided by a survey from Findaproperty.com, Country Life reports.
The survey compared house prices according to their proximity to certain underground stations and found that the Circle Line, which runs through some of the most fashionable parts of central London, had the most expensive properties of any area served by the tube. Victoria, Farringdon and Portland Street were the stops with the priciest neighbourhoods, while even the least expensive locality on the line, near Aldgate station, saw prices above the London average at £396,000.
While there may therefore be a window of opportunity for investors to buy in central London before the market starts to soar again, one fact remains constant: prime areas with good transport will be the ones which attract the high prices.
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2025
